Three kinds of political risks evidenced in Chavez’s Venezuela case study
Basically from the Chavez’s Venezuela case study, there are ideally various kinds of political risks. However, the three notable kinds include; a progressive curtailing of the political freedoms; allowing the National Assembly to approve a measure which allows the state to appoint and remove the Supreme Court Justices as well as revoking a dozen licenses belonging to radio stations while proposing a legislation for imprisoning broadcasters and journalist found to be harming the state’s interests. The embraced political risks significantly led to drastic changes in the business milieu of Venezuela.
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Based on the above political risks, it materializes to be politically risky for Chavez’s Venezuela to curtail the political freedom in Venezuela in the sense that most of the passed bills are bound to favor what the sitting government would wish and want to carry out.
In fact, the case reveals that the opposition which was supposed to oversee the sitting government actions and evil plans by acting as the watchdog of the citizens had most of its prominent anti Chavez’s political members harassed. For instance, the former presidential candidate, Manuel Rosales who was supposed to put the government on toes to accomplish its pledges had to escape and seek asylum in Peru for fear of being arrested.
Other political opponents went into hiding while others were galled leaving Chavez’s government to run the state in manner it desired. This was particularly politically risky given that the drafted constitution had all its constituents passed into law without even debating. That is, there was no strong opposition given that the national assembly of Venezuela mainly comprised of Chavez’s followers.
Conversely, it is politically suicidal and risky for the Chavez’s Venezuela government to have powers over the judiciary which allows it to appoint and remove the Supreme Court Justices. In real sense, the judiciary ought to be independent from any kind of political interferences. Vesting the appointment and removal powers in the government’s hand implies that the Supreme Court proceedings are likely to be interfered with by the sitting government.
Thus, in as much as the government might be making unlawful moves or act contrary to the constitution, the supreme court judges may lack powers to issue appropriate rulings against the government. It is anticipated that all the rulings may favor the government. For instance, when someone files a petition against the government, the judicial system might be manipulated by the government so that the case is ruled in its favor. It will similarly be difficult for those in the Supreme Court System to be vetted on merit.
The final political risk that Chavez’s Venezuela’s government made was to hold over the consolidation of various government apparatus while vesting a lot of powers to the president. This made the president to misuse the powers he had to revoke a dozen licenses of various radio stations whilst proposing a legislative Act that could be used to imprison broadcasters and journalists who harmed the states interests.
This is perceived to be a political risk given that the media is supposed to have its own freedom and sovereignty when gathering and broadcasting news as well as opinions. By just compelling the cable television channels to lively cover the speeches made by Chavez’s, it appears that something sinister was being done by the government that it feared being publicly aired. This is likely to taint the sitting Chavez’s Venezuela government picture and make the citizens to lose trust in it by terming the president a dictator.
Labeling the Venezuela’s political system as a social democracy
Though claiming to be socialist, the Venezuelan political system is far from being called social democracy. In a mature social democracy, the state resources are shared equally among the citizens. There is also abundance of political freedom and respect for human rights. In other words, there is social and economic equality in addition to political and individual freedom. Respect for the rights of individual’s particular the right of expression forms the platform in which social, economic and political development is based.
On the contrary, the Venezuelan government under the pretext of being socialist has taken control of private industry. Turning private businesses into state owned corporations compromise the principles of social democracy. In essence, social democracy should be supportive of economic activities and free enterprises.
The control of economic activities has curtailed the growth of free enterprise which is fundamental in social and economic development. Further, the Venezuelan government has been accused of corruption which it purports to be fighting. The country has been ranked almost at the bottom in economic and corruption indicators by the World Bank and the Transparency International.
Besides economic and social fragilities, the Venezuelan government has succeeded in curtailing political freedom. The constitutional changes that have given the president extra powers and to rule by decree has immensely reduced the political freedom and expression.
Besides, the political opposition voices have been silenced while the media have been reigned on. In as much as the government would be claiming to achieve greater social and economic freedom from the previous government, social democracy is far from being achieved. As indicated, social democracy can be said to be achieved when there is high degree of economic, social and political freedom as well as the respect for human rights.
Chavez actions and the prospective Venezuela’s foreign investments
The move by the Venezuelan government to increase state control through nationalizing strategic industries including energy, telecommunication, banking and utilities contributed towards a reduction in foreign investments.
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The takeover by the state key foreign oil producing companies as well as other radical anti-business measures have also contributed to the decrease in investments in the oil sector. Moreover, the Venezuelan government has increased the state ownership stakes in most companies owned by the foreigners especially in the oil, telecom and energy sectors.
However, the state control over foreign, domestic and private industry is not limited to key strategic sectors such as oil and energy, but also to other sectors such as iron and steel industry. The nationalization of almost all sectors of the economy generally reduces foreign investments.
The expropriation of the company assets, price controls and tax hikes also decreases the foreign investments. The business environment in Venezuela also does not support foreign investments as it is fraught with corruption and mismanagement of resources. Venezuela is ranked among the most corrupt countries in the world. Investing in such an environment is non-viable.
Any economic activities are normally being supported by political and social stability. The political ideologies form the basis upon which economic activities thrive. The socialist ideology has been perceived not to be supportive of free enterprise. Therefore, socialist ideology advanced by the Venezuelan government is also another discouraging factor to the foreign investors.